Personal Contract Purchase (PCP) agreements have become one of the most popular ways to finance a car in recent years. However, many drivers are unaware they might be entitled to compensation if their PCP deal was mis-sold. Understanding your rights can help you claim back money you could be owed.
What is a PCP Agreement?
A PCP is a type of car finance where you pay monthly installments for a fixed term, with the option to either buy the car at the end, return it, or start a new agreement. It offers flexibility but can be costly if not properly explained.
When PCP Deals Are Mis-Sold
You might have a claim if:
- The total cost, interest rates, or fees weren’t made clear.
- You weren’t informed about commission payments to the dealer.
- You were pressured into taking the finance without being offered alternatives.
- The risks and conditions, like mileage limits, weren’t fully explained.
Your Compensation Rights
If your PCP was mis-sold, you could:
- Receive a refund on overpaid interest and fees.
- Have unfair terms removed from your agreement.
- Get compensation for financial loss.
How to Make a PCP Claim
- Gather Your Agreement Details – Find your finance contract and any related paperwork.
- Identify the Issue – Note down what you weren’t told or what was misleading.
- Contact the Lender – Submit a formal complaint explaining your case.
- Escalate if Needed – If the lender rejects your claim, you can take it to the Financial Ombudsman Service.
Final Thoughts
PCP finance can be a good option when sold fairly and transparently, but if you suspect you were mis-sold an agreement, you have the right to seek compensation. Knowing your rights is the first step toward reclaiming what’s yours.
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